Oct 26, 2010
Kenneth Cole, Iconix merger talks stalled
Oct 26, 2010
(Reuters) - Merger talks between apparel and shoe company Kenneth Cole Productions (KCP.N) and Iconix Brand Group (ICON.O) have stalled and are unlikely to resume soon, the New York Times' DealBook reported, sending Kenneth Cole's shares down as much as 11 percent Monday morning.
Op for Iconix
As a licensing company, Iconix does not typically run physical stores, and winding down Kenneth Cole's stores post-merger would have hurt about 40 percent of the company's revenues, the DealBook column reported, citing people involved in the talks.
In September, Bloomberg had reported that Kenneth Cole was in talks to be acquired by Iconix.
When contacted, Iconix said it does not comment on possible acquisitions. Kenneth Cole did not respond to calls.
Iconix owns and licenses brands including Candies, Joe Boxer and Badgley Mischka. It sells those brands to Target Corp (TGT.N), Wal-Mart Stores Inc (WMT.N) and Kohl's Corp (KSS.N).
Iconix's Chief Executive Neil Cole is brother of clothing designer Kenneth Cole, the chairman of Kenneth Cole Productions since the company's inception in 1982.
Shares of New York City-based Kenneth Cole had gained 23 percent since the company reported better-than-expected second-quarter results in August.
They touched a low of $13.15, but pared most of the losses and were down 1 percent at $14.68 Monday afternoon on the New York Stock Exchange.
Iconix shares were up 1 percent at $17.68 on Nasdaq.
(Reporting by NR Sethuraman and Nivedita Bhattacharjee in Bangalore; Editing by Anthony Kurian, Unnikrishnan Nair)
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